In EQ2 they are called Heritage Quests -- they are shorter than epic quests but much longer than regular quests and they result in decent to excellent items that are versions of classic EQ1 loot. jboots, shiny brass shield, wurmslayer, etc. Many of them are really fantastic quests and well done, though these days the rewards have not kept up with gear inflation and at certain tiers the rewards are heavily biased toward particular class archetypes (melee dps, int caster, etc.). Still, for old-school eq1 players they return to some of the lore, locations, and even NPCs of EQ1 (or their descendants) and have enough of that good old tongue-in-cheek wit about them to feel like a bit of the EQ1 attitude in EQ2. I have to say, the sense of humor in EQ1 and even in EQ2 is part of what kept me so hooked on the game. Far more so than many other MMOs I tried, which either shot too low with their sense of humor (WoW) or were just way too serious.
EQ2 also has signature quests, which are more storyline driven around the new mythology or lore.
The key with both these is a good long diverse storyline and a solid reward. Also, EQ2 has a system of Status Points that these quests would give characters (and normal quests did not). Those points then had value in the purchase of mounts, housing, rent, etc.
Still, I really enjoyed the heritage quests we did in EQ2.
As for player housing in EQ2, some people really get a thrill out of decorating theirs in EQ2, but the system there has movable placeable objects that only the owner can move, and a lot of them that can be resized, reoriented, etc., so you can do some really creative stuff (split rooms horizontally to make two floors, build stairs out of benches, etc.). There are also specific items that can only be placed in your house that have game advantages, like a mirror to hold two different AA point configurations, teleport NPCs or objects, a mailbox, plants that grow foods with special properties, etc. Also your housing is important in the way the bazaar broker system works in EQ2. Even with all that, it's something most players pay little to no attention. I just don't see it being worth the coding trouble.
What about converting some of the old cities into dungeons? In EQ2 the high elves went Nazi and Felwithe is a dungeon zone. Katta Kastelum (sp?) and Sanctus Seru were always mixed city/hunting zones. They could even possibly be turned into raid zones (Sanctus had at least one raid mob iirc). Maybe Grobb and Rivervale? I remember folks hunting in Rivervale a lot actually, though for the life of me I can't recall why.